Critical Review: Data Storage (NASDAQ:DTST) & Dropbox (NASDAQ:DBX)

Dropbox (NASDAQ:DBX) and Data Storage (NASDAQ:DTST) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, institutional ownership, risk, analyst recommendations and profitability.

Volatility & Risk

Dropbox has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500. Comparatively, Data Storage has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Dropbox and Data Storage, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dropbox	1	2	1	0	2.00
Data Storage	2	1	0	0	1.33

Dropbox currently has a consensus price target of $31.33, suggesting a potential upside of 27.76%. Given Dropbox’s stronger consensus rating and higher probable upside, analysts plainly believe Dropbox is more favorable than Data Storage.

Profitability

This table compares Dropbox and Data Storage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dropbox	19.87%	-49.51%	19.48%
Data Storage	81.52%	-1.13%	-0.94%

Institutional & Insider Ownership

94.8% of Dropbox shares are held by institutional investors. Comparatively, 11.6% of Data Storage shares are held by institutional investors. 30.0% of Dropbox shares are held by company insiders. Comparatively, 43.8% of Data Storage shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Dropbox and Data Storage”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Dropbox	$2.55 billion	2.49	$452.30 million	$1.77	13.86
Data Storage	$25.37 million	1.26	$520,000.00	$2.14	2.06

Dropbox has higher revenue and earnings than Data Storage. Data Storage is trading at a lower price-to-earnings ratio than Dropbox, indicating that it is currently the more affordable of the two stocks.

Summary

Dropbox beats Data Storage on 9 of the 14 factors compared between the two stocks.

About Dropbox

Dropbox, Inc. provides a content collaboration platform worldwide. The company's platform allows individuals, families, teams, and organizations to collaborate and sign up for free through its website or app, as well as upgrade to a paid subscription plan for premium features. It serves customers in professional services, technology, media, education, industrial, consumer and retail, and financial services industries. The company was formerly known as Evenflow, Inc. and changed its name to Dropbox, Inc. in October 2009. Dropbox, Inc. was incorporated in 2007 and is headquartered in San Francisco, California.

About Data Storage

Data Storage Corporation provides data management and cloud solutions in the United States and internationally. It offers a suite of multi-cloud IT solutions, including cyber security solutions, which comprise ezSecurity, a security solution for endpoint security, system assessments, and risk analysis, as well as IBM system protection, including Ransomware defense. The company also provides data protection and recovery solutions, such as ezVault for offsite data protection; ezRecovery for fast data recovery; ezAvailability for real-time data replication with minimal recovery objectives; and ezMirror for data mirroring at the storage level. In addition, it offers cloud hosted production systems comprising ezHost, which delivers managed cloud services; and voice and data solutions, including Nexxis, which specializes in voice over internet protocol, internet access, and data transport solutions, which comprise dedicated internet services, SD-WAN options, and a cloud-based PBX solution. The company offers its solutions and services to businesses in healthcare, banking and finance, distribution services, manufacturing, construction, education, and government industries. Data Storage Corporation was founded in 2001 and is headquartered in Melville, New York.